I want to share an interesting question I got from a student on my private Facebook coaching page, and my answer which, honestly, may surprise you…
“Should I send blind offers?”
So, I’ve actually mailed blind offer letters before…
A blind offer is when you send a letter that includes a price you’re willing to pay the seller for their property. “I’ll buy your house for $XXX.”
As opposed to a general letter that simply says, “I want to buy your house,” but doesn’t include a price.
The idea with this strategy is that it might give you a foot in the door with the seller. If they’re willing to entertain an offer somewhere near the price you’ve offered, they’d give you a call.
So, it stands to reason you’d get fewer calls, but the calls you do get would potentially be better quality leads, right?
Like I said, I’ve tried this approach…
We did this in a couple different markets by offering 60%-70% of the tax-assessed value or Zillow value. And yeah, we got a couple deals this way – we also got a lot of angry calls too. :/
Truth be told, when tracking my blind offers, the results were only so-so. Just okay. I found that it’s just not as productive or profitable as general direct mail letters.
We stopped blind offers… because the numbers showed us it just wasn’t worthwhile. We weren’t doing any better than our regular direct mail.
And when I sat down to really think about it… I realized this simply reinforces what I teach my students and what I know about the fundamentals of investing…
You’ll make more money belly button to belly button with sellers at the kitchen table.
In other words, you’ll always do more deals when you’re negotiating and working a deal face to face.
Now, having said that, I have started investing in land…
And with land deals, blind offers are the ONLY method we use.
Well, if we sent a general letter, we’d get wayyyy to many calls. But more than that, we can send blind offers because the land niche isn’t all that competitive.
How do we make these blind offers on land? Well, in a nutshell…
When we look at land comps, we’re not looking at what’s sold, necessarily, we’re looking at what properties with similar acreage in that county are currently listed and selling for.
We want to sell it for 50% of that, so we’re making offers at 20% of the lowest comps—and we’re getting offers accepted. Lots of them! (About 1 in every 300…. Yes, that’s a lot.)
So, we’re happily getting land deals that are “dirt cheap” – yep, I said it.
Regular deals, I’d skip the blind offers.
Land deals, send ‘em!